6 Tips for Doing Home Addition Projects the Right Way

Home additions and renovations can be purposeful, aesthetic, functional, or a need that strikes deeper into your personal idea of living space. Perhaps you’re building a guest cottage, new garage, or outbuilding; adding a deck; installing a pool; or upgrading the bedrooms and bathrooms to better reflect the current situation and age of your family.

Although the specifics of each of these undertakings may vary, the same underlying principles apply to each of them, so we’re sharing six tips for tackling home addition projects the right way.

How to get started with a home addition

Home additions can boost the value of the home while enhancing aesthetics and functionality. In fact, home additions and renovations can be among the most effective ways to increase your home’s value, and you can tailor the construction to your particular stage in life in a way that is customized to your needs and wants.

To transform your home addition ideas into a completed project, there are a few steps to consider first:

•  Create a plan

•  Set a clear budget

•  Work with trusted professionals

•  Decide what parts of your home addition you can do yourself

•  Research and obtain permits

•  Fund your project

Create a Plan for Your Home Addition

Perhaps you’re adding an extra bedroom and bathroom to the back of your house for a place for guests to stay. As part of the process, you’ll need to first make sure that the addition will fit within your property lines; you’ll also want to check with your local government to see how closely codes in your city allow you to build next to someone else’s property.

While creating your home addition plan, also ensure that any construction will not interfere with utility lines or pipes, as well as whether the structural changes you’re considering will fit into the framing and foundation of your building.

As you design the bedroom and bathroom, think about them from two perspectives: first, how these rooms will add value to your living space; then, how the construction will impact the outside of your home, architecturally speaking.

You’ll also need detailed plans drawn up by an architect or builder that describe the scope of the work and the materials needed. To consider how home additions may increase the value of your home, discover the resale value of your next real estate improvement project with our Home Project Value Estimator.

One strategy to approaching home additions is to create your dream list, then have alternate choices in mind if your budget, material availability, or other external factors create a need to alter the project down the road. For example, you may love the look of marble flooring, but its price point might be higher than you’d initially estimated—or perhaps it doesn’t blend in with the rest of your house once you’ve started laying out the plans. Having a back-up plan—and one that’s cost-efficient at that—could help keep your budget in check.

According to HomeAdvisor.com , home additions can typically cost anywhere from $14,000 to $150,000, with the average home addition cost being $40,915. This figure doesn’t take into account factors like where you live, the size and scope of your addition, or the slope of your property, all of which can vary across the country. Plus, if you want your addition to blend in with the rest of your house, you also may need to plan for improvements in existing rooms.

Set a Clear Budget for Your Home Addition

According to HouseLogic.com , major upgrades like a bathroom remodel or family-room addition typically run $100 to $200 per square foot; sometimes, they can cost much more. This article recommends that you set a budget for your home addition by first obtaining bids from three professionals, then adding in 15 to 20 percent to the overall project price given by the contractor to cover unforeseen costs.

If the ballpark figure is too high and doesn’t align with your budget, then you might want to look at alternative choices for materials that will still give you the general renovation you desire. You could also scale back on your plans or save some of the more costly home addition projects for the future when your budget allows.

If you intend to work with a specific contractor, then your chosen company may be able to help you find lower-cost options—for example, replacing granite countertops with laminate ones—and offer creative solutions gleaned from years of industry experience. Or you may want to look at reducing the scope of your project to a smaller addition or even asking the contractor for competitive pricing for the off-season.

Work with Trusted Professionals

Whether you do some of the home addition work yourself or plan to have the professionals of your choice build the addition, it’s crucial that you hire the right contractor for your needs. Tips for working with contractors include:

•  Get three to six bids, then research companies that seem like good matches. You can check for information about these contractors at LinkedIn , Angie’s List , and the Better Business Bureau . Have any complaints been filed at your state’s contractor board? (You can find state-by-state licensing requirements for contractors here .)

For contractors who interest you, reach out to references they provide for personal experiences from past clients.

•  Be wary of suspiciously low bids. If a quote comes in significantly lower than that of the other contractors who bid your home addition project, it’s possible that contractor may not understand exactly what you want; this can lead to significant problems if you hire this company without clarifying specifics.
•  Hire a contractor who you think you can work well with, but don’t base your decision largely on emotion.

Decide What Parts of Your Home Addition You Can Do Yourself

Say the home addition ideas you have are necessary to solve space problems, perhaps you’re having a baby, or maybe your mother is moving in with you—but you’ve got to find a way to adjust the costs of a home addition. In this case, it might make sense to figure out what you can do yourself.

If you’ve got the experience needed to do the demo work safely without damaging load-bearing walls, electrical wires, and the like, this can save you some money on labor. If you’ve got professional-level skills in plumbing or drywall, you might talk to your contractor about taking on those tasks yourself and further reducing the cost of labor. Or you can attempt the finish work, such as sanding walls, painting, and general cleanup.

Research & Obtain Permitting Requirements

Unfortunately, a home addition isn’t as simple as deciding what you want to do, saving up, then paying for the work. You also need to make sure your home is appropriately zoned for the home addition or remodel. Depending on the scope of the project, you may or may not need a permit.

For example, if you want to build a deck in some states, you need a permit if you intend for it to be more than 30 inches off the ground. Getting to know your local codes can help surmount significant hurdles as the project unfolds, which often will save time and money for homeowners.

Strategically Fund Your Project

To find materials for your home addition on a budget, you could shop at stores like a Habitat for Humanity ReStore , attend auctions, or explore similar options to find salvaged materials. Before you go this route, though, if you’re employing a contractor, make sure he is willing to work with recycled materials and ones that may not be standard size.

When adding a room to a house that’s a higher priced project, it might be tempting to use credit cards to pay for expenses. If you’re doing this to maintain a record of your spending or to take advantage of credit card reward points, this can be a good strategy provided you can pay off the balance quickly, ideally within a single billing cycle.

But when you can’t pay off the balances, it can be easy to get caught up in a spiral of debt, and credit card debt is especially challenging. Why?

Credit card companies typically charge compound interest on the current balances on your accounts, which means they charge interest on the accrued interest—in other words, there is interest that’s continually being calculated on a daily basis and added to your balance until you pay it off in full.

To find out how compound interest is affecting your outstanding balances, you can use our credit card interest calculator.

Getting a Home Improvement Loans for Your Home Addition

Consider getting a home improvement loan for your home addition project. At SoFi, we offer competitive rate home improvement loans that can allow you to focus less on your budget and more on building your dreams.

Benefits of choosing SoFi for your personal loan for your home improvements include:

•  A quick process: You’re anxious to get started (who wouldn’t be?) and, on average, it takes only seven days from online approval to funding, allowing you to transform your home addition plans into reality soon.
•  Fixed payments: This is ideal for budgeting purposes.
•  Absolutely no fees: No surprises, no hidden fees, no catches. None.

When it comes to our personal loans, they are 100% fee-free. Plus, the application process is fast and easy, conveniently online, and you have access to live customer support seven days a week.

If you lose your job, we can pause your payments temporarily, and even help you to find a new job.

The Takeaway

A home addition can increase the value of your real estate while also allowing you to retrofit your house to your current lifestyle. There are many factors that figure into a big decision like a renovation, and it’s important to consider it from as many angles as possible.

With a quick online application process and lower rates than most credit cards, SoFi personal loans can help you make your house a dream home. Check your rate in just two minutes.

Ready to get started? You can find your rate in just two minutes, with no commitment. When you’re ready to get going with your home addition plans, you can apply for your personal loan quickly and easily.


SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
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How Much Does It Cost to Paint a House?

Painting your house can be the quickest way to dramatically alter its appearance, but how economical is it? Depending on the size of your home, the cost of painting a house will vary based on materials used, whether you hire professional help or do it yourself, and the size and texture of the surface area to be painted.

There are several reasons a homeowner might want to refresh a house via a coat of paint: to change the overall look or aesthetic, to brighten a room and enhance natural light, or to maintain the integrity of the material from weather elements. Plus, keeping your home updated may increase its value.

Here are some factors to take into consideration when trying to figure out how much it will cost to paint your house.

How much does it cost to paint an interior?

Let’s start with the paint job you’ll spend the most of your time looking at: the interior. The cost of painting an interior space varies greatly due to the type of paint materials you choose, what condition the previous surface is in, if you’re planning on doing the doors and trim in addition to walls, if you hire a professional painter, and how many rooms you’d like to paint.

Cost to paint per square footage

You may expect the cost for an average-sized room, approximately 10 feet by 12 feet in size, to be somewhere between $300 to $1,000 for a professional job using $2 to $6 a square foot as a price baseline with $3.50 as an average. If you do it yourself, the cost of the paint and materials might set you back around $200 to $300 .

When looking at material costs, consider that a gallon of paint normally covers around 400 square feet and know that sometimes labels overestimate how much surface area a gallon can cover. If you’re painting a textured wall, you’ll likely require more paint because the texture increases surface area, and if you’re painting a raw material like fresh drywall or bare wood, the absorption into the substrate can quickly increase the amount of paint you’ll need.

When hiring help to paint your home, how quickly you want the job done also may affect the overall cost. An experienced painter might be able to cover a wall faster and therefore cost less, whereas a more methodical painter may need more time. Generally, you can expect a painter to be able to cover about 100 to 120 square feet in an hour.

Cost to paint by paint type

Prices vary based on what type of paint you choose and how much material you need, but you can base estimates off the fact that most paint is priced in the range of $15 to $40 a gallon for higher-end paint, and you’ll probably need between one to two gallons of paint per room.

Primer, which is a necessary first step for most projects, might cost around $10 to $20 a can, but if you’re on a budget or time crunch, you can purchase paint colors that combine primer to save time. If using primer, which is especially necessary when painting a lighter color atop a darker one, you’ll typically use at least two quarts of primer to cover one average-sized wall.

While these prices may fluctuate, here is a breakdown of popular paint brands and the average cost of paint per gallon:

Brand Average cost per gallon
Behr $30-$57
Benjamin Moore $42-$80
Farrow & Ball $80-$120
Sherwin Williams $37-$102
Valspar $13-$55

Prices were accurate at the time of publication.

Professional Painter Costs

On average, professional painters cost $30 to $40 per hour per painter. The overall cost to paint your house can increase based on the prep work needed before painting and any equipment rentals such as scaffolding or a lift that may be required.

If on a set budget, when negotiating cost with a painter, consider proposing a project fee versus an hourly rate, as well as doing any prep work yourself. The added time required for properly preparing a surface for a topcoat of paint may be the highest cost of a project.

Non-Paint Costs

When painting your home, you’ll encounter a variety of costs for the tools required to paint. Some of these supplies like brushes and drop cloths can be used again, so in the long run, purchasing your own tools may save you money. If paying for labor, you may be able to deduct the costs of supplies if you provide your own, though professional painters typically use their own reusable supplies.

Necessary painting supplies may include:

•   Painter’s tape:To protect areas like ceilings and trims from getting paint on them
•   Dropcloth: To cover floors and furniture that could be damaged
•   Ladder: To paint a high wall or harder-to-reach areas
•   Paint tray or bucket: You’ll add a small amount of paint to this tray or bucket to use while painting to efficiently use a roller and to preserve the unused portion of the original gallon of paint
•   Paint rollers and brushes: A roller covers larger areas more evenly while a small brush can be used for touch-ups and corner cut-in

How Much Does It Cost to Paint a House Exterior?

The national average cost of painting a home exterior is $2,928, but a 2,500-square-foot house can range from around $1,250 to more than $8,750 depending on a variety of factors. Painting the exterior of your home could increase your home’s value, potentially improve the structural integrity of the building and give you the chance to make any needed exterior repairs at the same time.

Two of the biggest factors that determine how much it costs to paint your home exterior are square footage and how many stories your home has (hint: the more stories, the higher the price). Additionally, the type of window framing (wood, metal, or vinyl) can increase the amount of time required to complete the work and affect the price.

While costs vary based on factors like location and type of paint, this chart from HomeAdvisor should give you an idea of what it may cost to paint your house. Please note that these estimates include labor costs as the painting of the exterior is a job better suited for a professional.

Home Stories Square Footage Cost Range
Single Story 1,000–1,500 $1,500–$3,500
Two Stories 1,500–2,500 $3,000–$6,200
Three Stories 2,500–3,000+ $4,500–$10,000+

Exterior painting can get complicated due to the variety of materials you can find on the outside of a home. Different materials require different paints and tools in order to prepare them for the outdoor elements.

To budget for how much it might cost to paint the exterior of your house, you have to look at each type of material you’ll have to paint. The following estimates look at the costs of painting a few materials, including the tools, paint, and labor possibly required to complete the paint job.

Concrete Siding

Cost estimate: $500 (app. 250 sq. ft.) to $3,000 (app. 1,000 sq. ft.)

Why: Because concrete walls have to be prepared before painting, you may be required to remove previous finishes to ensure the paint won’t peel or chip off, which can increase labor costs. In order to prime the concrete, you may need special sealants, paints, and primers to help the final coat of paint endure against the elements.

Metal Siding

Cost estimate: $400 to $3,500

Why: Metal siding, generally made of aluminum and galvanized steel, may require cleaning before painting. If any of the metal is rusted or damaged—or there are missing pieces—a professional may have to repair the metal. If the damage is severe, old paint likely will need to be removed from the area around the problem in advance of painting.

Stucco Siding

Cost estimate: $1,400 to $6,000

Why: Depending on the state of the previous paint job, stucco can be one of the easier materials to paint. The smooth and limited variability of the surface might make a stucco project more affordable than painting other types of materials. The process may involve cleaning the stucco, caulking windows, and filling in surface cracks, although if the previous paint has deteriorated to the point of peeling or bubbling, the amount and nature of preparation work can increase.

Vinyl Siding

Cost estimate: $600 to $3,500

Why: Vinyl siding needs to be cleaned and repaired, if necessary, before beginning to paint, and a careful evaluation of the benefits is often the best approach. It can be about the same cost to replace vinyl as it would be to paint the surface, as vinyl is typically installed with the chosen color embedded within the plastic. Additionally, the plastic is often brittle with age and doesn’t always warrant the investment in money for a paint job.

Wood Siding

Cost estimate: $700 to $3,000

Why: Similar to painting wood furniture or floors, wood siding that is damaged due to element exposure can be painted or stained. This process may help defend wood siding against sun, humidity, pollen, mold, and other environmental elements like insects. The cost might increase if the wood has holes or other issues, but the painting process should help protect your home’s exterior from needing more repairs later on.

Tips on How to Pay for the Cost of Painting Your House

Because painting supplies and labor costs are often different depending on regional aspects and the large variety of substrates, it can be difficult to know your final cost of painting your house until you research supplies and professionals in your area. In the meantime, you can check out this paint cost calculator for an idea of how much you may spend to paint the inside or outside of your home.

The Takeaway

The cost to paint a house is dependent upon the size and texture of the surface area, the kind of paint used, and whether you hire a professional or tackle the painting yourself. If you don’t have the available cash to pay for the costs of painting, it’s often preferable to find ways to save up for your project.

As an alternative, you can consider applying for a SoFi Personal Loan to help with home improvement projects. Unsecured personal loans can be used for a variety of purposes and can go a long way to help making your home improvement ideas a reality.

With a quick online application process and lower rates than most credit cards, SoFi Personal Loans can help you transform your house into a dream home. Check your rate in just two minutes.

Need a change of color? Find your rate for a SoFi personal loan today.


Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

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Source: sofi.com

Are Home Warranties Worth It?

Congratulations on the new home. But hang on. The garbage disposal isn’t working as it should. The hot water doesn’t seem to be hot anymore. A home warranty can ease the headaches and financial strain of fixing or replacing appliances and home systems, but any contract will require much more than a glance.

A policy can be purchased directly from a home warranty company at any time, not just upon a move-in. In some cases, the seller may provide a home warranty with the sale of the home.

Home warranties can help protect new homeowners and existing owners from troubles here and there, but is a home warranty really worth it?

What Exactly Is a Home Warranty?

A home warranty—different from homeowners insurance—covers specific items such as home systems (things like the HVAC system), washers and dryers, kitchen appliances, pool equipment, garbage disposals, and exposed electrical work.

Homeowners insurance covers theft and damage to a home from perils like fire, wind, and lightning strikes.

While homeowners insurance is typically required by a mortgage company, home warranties are optional.

Price of a Home Warranty

The cost of a home warranty can range from about $350 to $600 a year, or more for coverage for items not on the stock home warranty list. Extras may include pool systems and septic systems.

Those who purchase a home warranty will pay that annual premium, but if they do call in a service provider they will likely have to pay a fee for service calls, too.

Depending on the extent of the issue, the service call may cost anywhere from $60 to $125.

Pros of a Home Warranty

resale value. When selling a home, homeowners with a home warranty may be able to transfer the warranty to the new owner, which could be a bargaining chip for those attempting to sell an older home. (Some home warranties are non-transferable, so it’s up to sellers to do their due diligence when adding this to the deal.)

Cons of a Home Warranty

A downside of a home warranty is that it can be complicated to understand. That’s why it’s up to every purchaser to carefully read the contract before signing and ask all the questions they need to in order to understand the warranty.

For example, a home warranty may come with a financial limit per repair or per year. So if someone ends up having one heck of a year with the appliances, some of those repairs may not be covered.

You may need to request additional coverage for appliances that are considered optional or replaced frequently. And will your Sub-Zero fridge and Wolf range be covered if they go kaput? (Not likely.) Most warranty companies list excluded items on their sample contracts.

Ask: Will the plan repair or replace a broken item? If a repair is considered too expensive, the provider might offer to replace the broken item—but give you only the depreciated value.

Claims can also be denied by the warranty company for a variety of reasons, including if it believes an appliance hasn’t properly been maintained. The warranty company can also ultimately decide if a problem is worth fixing or not, despite how the homeowner feels about the situation.

Home warranties also cannot guarantee timeliness. If something breaks, homeowners may have to wait longer than they’d like to get it fixed.

Home warranties will also likely not cover preexisting conditions. If a person moves into a home with a termite problem, the warranty will likely not cover the cost to repair issues. Before you sign the warranty, the company will probably come inspect all the items covered, and could deny coverage for certain items.

Choosing the Right Home Warranty

This really comes down to personal choice and research. It’s important to look into each contract to see what is covered, what isn’t, the cost of services, and more.

While searching the internet for the right home warranty, it may be best to go beyond online reviews. Rather than looking on public listings, head over to websites like the Better Business Bureau and search for individual companies.

There, would-be home warranty buyers can search for companies to read the vetted reviews, alongside any potential complaints.

Is a Home Warranty Really Worth It?

A home warranty could be the right call for people who are not up for having to perform repairs themselves or don’t have time to hire technicians.

home’s inspection report. If there are red flags about a home’s condition, it may be a good idea to purchase a home warranty to cover any additional expenses that crop up.

Alternatives to Home Warranties

If homeowners are worried about protecting their investment but aren’t sure a home warranty is right for them, there is an alternative: Build up an emergency fund.

Homeowners can start stashing away cash into an emergency savings fund that they can dip into whenever they need repairs done. This acts as their own “home warranty” without having to pay a premium to a company.

To take it one step further, homeowners could also create a spreadsheet with the names of repair workers when they need something fixed.

The Takeaway

Are home warranties worth it? Anyone looking into purchasing one will want to take a close look at the annual cost, the charge for service calls, exactly what is and isn’t included, and how much of a replacement item is covered. Convenience is a benefit, but an alternative is to self-insure with an emergency fund.

Buyers might face another decision: choosing the right home loan lender. Looking into a SoFi mortgage is a great place to start.

House hunters can check their rate in a snap.

SoFi members can save a chunk of change on loan processing fees and enjoy all of the other benefits of membership.

Shopping for a home? See how a SoFi mortgage sizes up.



SoFi Loan Products
SoFi loans are originated by SoFi Lending Corp (dba SoFi), a lender licensed by the Department of Financial Protection and Innovation under the California Financing Law, license # 6054612; NMLS # 1121636 . For additional product-specific legal and licensing information, see SoFi.com/legal.

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Terms, conditions, and state restrictions apply. SoFi Home Loans are not available in all states. See SoFi.com/eligibility for more information.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.

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7 Tips for Maintaining the Value of Your Home

Before signing the dotted line for a new home, your real estate agent might point out features about the property that could be “good for resale value.” And while you may be in the market for your forever home, the unexpected twists and turns of life mean that people sell their homes for a million reasons.

For homebuyers who are in the market for a smart investment, selling their home when the time is right is the objective from Day One. They may anticipate the future of an up-and-coming neighborhood, get a killer deal on a short sale or foreclosure, or intend to upgrade once they grow their families.

For others, a move can be unexpected. Issues like financial changes (for better or worse), job transfers, unexpected bills, marriage or divorce, or the need for more or less space can all motivate homeowners to sell.

And for a few, they just realize that the house they bought isn’t right for them.

In fact, Americans move every five to seven years on average. (Apparently, we’re a restless lot.)

No matter what your future plans are for your home, doing what you can to maintain its value can be a smart strategy. And while some value-add items take care of themselves, like the property’s location and the current real estate market, the majority are up to the homeowners.

And let’s be real. When it comes to working on a home, a little work here and there is a lot less painful than a lot of work on a moment’s notice.

Here are some ideas for creating a home maintenance checklist:

Update, Update, Update.

If a home that’s for sale has an updated anything, the real estate listing will scream it out in ALL CAPS. This can apply to appliances, cabinetry and countertops, flooring, popcorn ceiling, bathroom remodels, kitchen remodels, and more.

But which updates will actually add value to the house is a different question, and the answer can vary depending on current trends. In 2020, for example, home buyers are looking for large, spacious kitchens and, thanks to COVID-19, a home office space.

If your kitchen is due for an update, try to keep in mind that this doesn’t necessarily mean stripping it to the studs and starting from scratch. Are the cabinets in good shape? Consider a fresh coat of paint or stain to reflect the latest color trends.

value estimator could help inform your decision.

Keeping an Eye on the Big Ticket Items

Repainting to cover wall damage or update to a more modern color is a project that may not take too much time or money out of your budget.

Repairing or replacing a home’s expensive items, like the foundation, roof, electrical, plumbing, water, septic, well, A/C—can come with some serious sticker shock.

Issues with a home’s foundation, for example, can cost upwards of $10,000 to remedy. But a foundation inspection? That’s more like $350 to $1,000 . And keeping an eye on the foundation and walls yourself is free. Note that estimates will vary based on factors like location, the size of the house, and the extent of repairs required.

Aside from the foundation, replacing a home’s central heating and air system can be a significant expense that can also cost five figures to replace in the event of a total failure. The biggest contributor? According to an article on Realtor.com, it’s neglect .

Regular maintenance can help extend the life of the system so it can reach it’s full life expectancy—which is generally about 15 years.

Staying On Top of Maintenance

According to HomeAdvisor’s State of Home Spending Report , the average homeowner spent $1,105 a year on maintenance in 2018. That sounds like a lot, but when compared to the average cost of $7,560 for home improvement projects in 2018, it starts to sound more affordable.

What’s more, the report found that homeowners completed an average of 6.7 home maintenance projects vs. just 2.2 home improvement projects.

For their study, they listed items like HVAC maintenance, cleaning gutters, and landscaping as maintenance-related projects, but the list can also include keeping up with the pool or hot tub, power washing siding, decking, or concrete areas.

If it seems like a lot to remember, consider setting reminders on your smartphone for things like replacing A/C filters, having carpets professionally cleaned, or flushing out the hot tub.

You may also consider adding a line item into your budget for maintenance items, since these are normal costs of owning a home and it can help to plan for them.

Improving Curb Appeal

If there’s a “For Sale” sign in front of your house, the outside will be the first thing a potential homebuyer judges about your property. If not, the way your home looks as visitors arrive still makes a statement.

To evaluate the outside of your home, look at it from a visitor’s perspective. Is the grass trim? Are the weeds under control? Consider taking a look at the driveway, mailbox, and front porch area and asking yourself, if you were thinking about purchasing this home, would you be interested based on the curb appeal?

If the answer is no, it doesn’t mean you have to dig into the dirt. An affordable landscaper can help if your home is lush with vegetation, invest in mulch to help keep weeds under control, and consider native plants and shrubbery that require the least maintenance.

Another item that deserves attention is your front door. It creates a statement about your home, serves as a welcome to visitors and, if it’s steel, comes with an amazing return on investment—as much as 91% of the costs, which average around $1,500.

Upgrading Energy Efficiency

89% of homebuyers report wanting to see efficient windows and appliances in a home), but also if you want to reduce spending on bills and taxes . And it doesn’t just mean big investments like switching to solar or wind-powered energy, although those are both growing trends .

Making your home more energy efficient can also be as simple as replacing bad weather seals, ensuring that the attic has sufficient insulation, paying attention to the air and heating, and using energy-efficient light bulbs and appliances.

Upgrading the energy efficiency of your home is something that might even be rolled in with another project, such as maintenance or updating.

Installing Smart Tech

Even if your home is more than 100 years, old adding smart tech can make it 21st-century ready. Smart home assistants like Google or Alexa, for example, can control everything from the lights to the TV to locking the front door.

They can also allow you to remotely control your heating and air temperatures, make sure the oven is actually turned off, and even give you a sense of security with security systems or video door bells. In order for the home assistants to accomplish all of these features, additional smart appliances may be required.

While some types of home tech are hard-wired into the house and others are more portable, even being able to say “wired for surround sound” can be a bonus on a home listing.

According to a recent Forbes report, smart home tech is starting to move up the must-have list for homebuyers. But, like energy efficiencies, adding it to your home can be a perk even if you have no immediate plans to move.

Keeping the Bugs at Bay

One important job that comes with homeownership is keeping unwanted critters outside where they belong. Public enemy No. 1 in this category? Termites. They can wreak havoc on a home’s wood structures to the tune of $1 billion in property damage every year.

The problem is so widespread that some home loan companies require buyers to get a termite letter , which is basically a guarantee that the home is free from termite damage.

DIY recommendations for keeping the pests at bay can also check off items on the home maintenance list, including keeping gutters and downspouts flowing, filling in any places where water pools around the home or in the yard, filling in cracks in the foundation and keeping air vets free and clear.

And if an ounce of prevention is worth a pound of cure, then a $75 to $150 termite inspection is worth avoiding a $1,000 termite treatment.

Beyond termites and the havoc they wreak, there are a variety of other living creatures that can cause damage to a home or surrounding property, including attic squatters like mice or raccoons, carpenter bees, moles, mosquitoes, and even grasshoppers that brunch on beautiful landscaping.

Making Improvements Affordable

Budgeting a few extra dollars a month for A/C filters is one thing, but putting on a new roof is a bigger beast. Before going down the path of home improvement, it can be important to determine whether the goal is to add resale value, or something that’s just a personal desire. If it’s the former, consider using a Home Project Value Estimator that can help determine whether it’s a smart investment, or if it might be wiser to take a different route.

From there, one next step could be to weigh the various options for paying for a home project. Some companies offer same-as-cash financing options, or deferred-interest loans , but in those cases it’s important to remember that if the balance isn’t paid by the deadline, it could lead to a payment that includes any leftover balance plus interest.

One way to avoid deferred-interest surprises is with a personal loan. Securing a low interest rate and a fixed monthly payment can mean no surprises, less hassle, and maybe even enough to hire an expert for the heavy lifting.

Ready to bring back or improve the value of your home? With SoFi’s Home Improvement Loans, qualifying borrows can get approved for up to $100,000.

Apply for a SoFi home improvement loan today!



Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.

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Options for Teacher Student Loan Forgiveness

Loan forgiveness is a trade-off. It’s about incentivizing graduates to work in low paying or otherwise undesirable positions in exchange for erasing or significantly reducing their student loan balance. Without these programs, important community institutions would be severely understaffed.

If you’re a teacher or education student reading this, those criteria probably sound familiar.

Many school districts struggle to fully staff their schools, especially when it comes to certain positions. Loan forgiveness programs are one of the best ways for them to attract job candidates and retain them for long enough to make an impact.

Teachers have several options when it comes to loan forgiveness. Here’s what you should know about each one.

Teacher Loan Forgiveness

The Teacher Loan Forgiveness Program is the only federal loan forgiveness program specifically designed for teachers. Math or science teachers who teach in secondary schools or special education teachers can have up to $17,500 worth of loans forgiven. Any other kind of teacher can only receive up to $5,000 worth of loan forgiveness.

The program has strict requirements. Teachers must hold a license or certification in their state and teach for five consecutive years in a school that primarily serves low-income students. A list of eligible schools is available here.

Teachers qualify even if they work at different schools for each of the five years, but each of those schools must be eligible.

Teacher Loan Forgiveness is only available for Direct Subsidized and Unsubsidized Loans, as well as Subsidized and Unsubsidized Federal Stafford Loans. Perkins loans are not eligible.

If you have a Direct Consolidation Loan or a Federal Consolidation Loan that includes a Perkins loan, that portion won’t be eligible for Teacher Loan Forgiveness. PLUS or graduate school loans are also not eligible for Teacher Loan Forgiveness.

Public Service Loan Forgiveness

The Public Service Loan Forgiveness Program (PSLF) is arguably the best forgiveness option for teachers. Unlike the Teacher Loan Forgiveness program, borrowers don’t have to work consecutive years to qualify. This is especially helpful for teachers who take a year or two off.

Teachers can work for an elementary or secondary school, in either a public or private school setting. They must work at least 30 hours a week to qualify. After 120 qualifying payments, they can apply to have their remaining loan balance forgiven. There is no limit on how much will be discharged, and teachers won’t owe taxes on the forgiven amount.

Only Direct Loans are eligible for PSLF. If you have FFEL or Perkins Loans, you’ll have to consolidate them into a Direct Consolidation Loan to qualify.

Teachers should submit the PSLF employer certification form every year, which will verify the employer and calculate how many qualifying payments have been made.

PSLF can be used with Teacher Loan Forgiveness, but borrowers will only receive credit for one program at a time. If $5,000 of your loans is forgiven after five years through Teacher Loan Forgiveness, those five years’ worth of payments will not count toward PSLF.

While working toward PSLF, teachers will have to choose from one of the income-driven repayment plans. These options will lower your monthly payment.

Perkins Loan Teacher Cancellation

Teachers with Perkins loans can have their loan balance entirely discharged. To be eligible, they must work full-time in a school with low-income children or as a special education teacher. Teachers can also become eligible by teaching a subject that has a shortage of teachers in their state.

Private school teachers and those who have two part-time teaching jobs also qualify. Preschool and kindergarten teachers may only be eligible if their state considers those grades to be part of elementary education.

Unlike PSLF or the Teacher Loan Forgiveness program, teachers can earn partial loan forgiveness. They’ll get 100% forgiveness after five years of service.

Here’s how much will be forgiven each year:

  • 15% forgiven after one year of work
  • 15% forgiven after two years of work
  • 20% forgiven after three years of work
  • 20% forgiven after four years of work
  • 30% forgiven after five years of work

State Forgiveness Programs

Your state may have its own teacher forgiveness program. Go here to see what options are available. You can also try Googling your state and “teacher forgiveness program” and see what comes up. You may have to teach in an underserved area or teach a specific subject to qualify.

Options for Private Student Loans

Teachers with private loans rarely have access to loan forgiveness. Here are some options available to them:

Refinance private loans

If you want to save money on private loans, your best option is to refinance to a lower interest rate.

Private lenders often require a credit score of 650 or higher to qualify for a refinance. Some lenders may also have an income requirement, but this depends on the specific lender. For example, LendKey accepts borrowers with low salaries.

When you refinance private loans, make sure you understand the term you’re signing up for. For example, if you have five years left on your private loans and refinance to a 10-year term, you may end up paying more interest over the life of the loan because the term is doubled.

If you can afford it, keep making the same payments as you were before. Assuming you haven’t significantly changed your budget or lost your source of income, this should be doable. Keeping the same payment rate will let you repay the loan faster and save on interest.

Take out a home equity loan

If you’re a homeowner, you can withdraw extra equity from your house and use it to repay your student loans. Generally, you’ll need to have 80% or more equity in the home to qualify.

Home equity loans may have lower interest rates and longer terms than private student loans. It may also be easier to qualify for a home equity loan because the bank has collateral behind it.

The downside to this strategy is that if you default on a home equity loan, the bank may repossess your house. Comparatively, refinancing your private student loans has much lower stakes.

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I Dropped Out of College: My Student Loan Repayment Options

No one intends to drop out of college. If you show up to campus for your freshman year, chances are you plan to graduate in four years and use your degree to land a job. Maybe you even have the whole thing mapped out, step-by-step.

But then life happens. Whether it’s a family emergency, deteriorating health, stress burnout, or just the realization that college isn’t the right choice, plenty of people choose to drop out of their university every year. The problem is, your student loans don’t go away just because you never ended up with a degree.

So how should someone in this position approach student loan repayment? Are there any unique considerations to take into account? Here’s what you need to know.

Choose an Income-Based Repayment Plan

If you have federal student loans, you’re eligible for the same repayment options available to borrowers with a degree.

You may currently be on the standard 10-year repayment plan, which will have the highest monthly payments and the lowest total interest. You have the option of switching to a less expensive option if you’re struggling with those payments. Use the official repayment calculator to see which plan lets you pay the least.

When you choose an extended, income-based, or graduated repayment plan, you’ll pay more interest overall than if you stuck with the standard plan. If you’re not working toward a specific forgiveness program, then it’s best to switch back to the standard plan as soon as you can afford it to minimize the interest.

Refinance Private Loans

Private student loans have fewer income-based repayment options than federal loans, and they rarely offer deferment or forbearance options. But you can refinance private loans for a lower interest rate, even if you dropped out.

There are a few lenders that service borrowers with uncompleted degrees.

These may include:

  • MEF
  • RISLA Student Loan Refinance
  • EDvestinU
  • PNC
  • Wells Fargo
  • Purefy
  • Discover Bank
  • Advance Education Loan
  • Citizens Bank

To be a good candidate for a student loan refinance, you must have a high credit score and no recent bankruptcies or defaults on your credit report. You also need a low debt-to-income ratio, and some lenders may have income requirements.

Financial aid expert Mark Kantrowitz of SavingforCollege.com said borrowers are unlikely to be good refinance candidates immediately after college because lenders usually require a minimum amount of full-time employment.

If you dropped out recently, you may want to wait a year before trying to refinance private loans. During that time, check your credit score through Mint, pay all your bills on time, avoid opening new loans or lines of credit, and pay your credit card bill in full every month.

Explore Deferment and Forbearance

Once you leave school, you’re eligible for a six-month grace period where federal student loan payments are put on hold. You won’t accrue interest during this time if you have subsidized loans, but you will if you have unsubsidized loans.

If you still need more time after the grace period has expired, you can apply for deferment or forbearance. Borrowers have to apply for deferment and forbearance manually and wait to be approved.

Deferment and forbearance are both federal programs that let borrowers avoid paying their student loans while still remaining current. The main difference between the two options is that interest will not accrue on your loan balance during deferment, but it will accrue during forbearance. For that reason, it’s harder to qualify for deferment.

Be careful about putting your loans in deferment or forbearance for a long time. The interest that accrues will capitalize, meaning it will be added to your loan’s principal. This will increase your total monthly payments and could delay your debt payoff timeline.

Apply for Public Service Loan Forgiveness

Public Service Loan Forgiveness (PSLF) is a program that encourages borrowers to choose a non-profit or government job. In exchange, your remaining loan balance will be forgiven after 10 year’s worth of payments, which do not have to be consecutive. It’s even available to borrowers who dropped out and never finished a degree.

“PSLF is always an option because it’s employer-dependent,” said student loan lawyer Joshua R. I. Cohen.

PSLF is only available for federal loans, and only those loans that are part of the Direct Loan Program. If you have FFEL or Perkins loans, you’ll have to consolidate them as part of the Direct Consolidation Program. This process will render them eligible for PSLF.

Be sure not to consolidate loans that are already part of the Direct Loan Program. If you’ve already been making payments, consolidating loans will restart the clock on PSLF, and you could lose credit for eligible payments you’ve already made.

The employer you work for must also be an eligible non-profit or government entity. Only full-time employees qualify for PSLF, which excludes part-time workers and independent contractors.

To be eligible for PSLF, you should fill out the employment certification form every year. This form asks for your employer’s contact information, your employment status, and more.

Once you submit the form, you should receive a notice verifying your employer and how many eligible payments you’ve made. Doing this every year will make it easier when you apply for forgiveness after your 120 payments have been made.

“It also gives borrowers an opportunity to dispute any errors or undercounts well before they reach eligibility for loan forgiveness, giving them plenty of time to address disputes,” said student loan lawyer Adam S. Minsky.

Borrowers can save money while working toward PSLF by choosing an income-based repayment plan instead of the standard 10-year plan. They also won’t owe taxes on the forgiven amount, so it’s best to choose the least expensive monthly option.

Try to Discharge Your Loans

If you couldn’t complete college because the department you were studying in closed, or your school committed fraud, you may be a good candidate for discharging your student loans completely. If this happened to you, contact a student loan lawyer who can help you file a case.

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How to Teach Your Teen to Budget Like a Pro

It amazes us how quickly our girls are growing up. Next month when school starts up again, we’ll have a fourth-grader and a kindergartener.

Even though we have some time before they are ready to move out of the house, we want to spend time now prepare them for the big transition. As a parent, you probably feel the same way too. 

One crucial piece of a financial foundation kids and in particular, teens, need to master is learning to budget (and sticking with it),

While they’re home now, you have a fantastic opportunity to get them comfortable with handling their money.

If you’re not sure where to start, here are some tips from fellow parents and experts in the personal finance space to make teaching this life skill a bit easier less stressful for you and your teen!

Teach Your Teen to Budget for Real Life

Teens or not, whenever most people hear the word budget, they also hear the word ‘no’. To them, budgets feel like a strict diet. Just as fad diets fail, an unrealistic or extreme budget will more than likely discourage your teen and they will quit.

The first step before you even talk about the numbers is to discuss exactly what a successful and sustainable budget should be. When done right, a budget is something that helps you move your money towards your goals. Explain to them that at its root, budget is simply a plan about what they’d like to do.

You want a budget that can cover:

  •     Essential bills
  •     Future goals
  •     Discretionary expenses

When your teen’s budget covers those goals, they’re not only putting their finances in a good spot, but they’re moving closer to their specific long term dreams.

Creating a Doable Budget (They’ll Actually Enjoy!)

Once your teen(s) understands how a budget works, it’s important for them to create a budget that they can use in the real world. You can honestly budget however you want, but an easy budget to get your teen started is the 50/20/30.

Quite simplify, the 50/20/30 budget puts money into those three main buckets:

  •     50%  goes towards essentials
  •     20% towards savings (or investing)
  •     30% for fun and discretionary expenses

I appreciate how easy and flexible this budget can be. You can adjust the percentages for your teen’s needs, but it gives them some ballpark idea of how to portion their finances when they are out on their own.

How do you start them out on this budget?

With teens, you may have expenses like clothing or their cellphone bill count as essentials, or you may want to give your child the experience of being responsible for a small, shared family bill while they are still at home.

For older teens, you could even charge them a nominal ‘rent’ to offset their portion of the bills. In some cases, parents give that money back to their child as a gift to help with moving expenses (like for their security deposit) or use as additional savings. 

However you decide, talk it over so your teen understands why you’re doing it this way.

Share Your Family Budget

Creating a budget isn’t complicated, but it can difficult if your teen has no idea what to expect. Knowledge can be empowering.

While we may take it for granted since have to deal with the numbers, but your teen may not be aware of how much it takes to keep the lights on and roof over their heads. If you haven’t already shared your own budget already, now is the time.

Not knowing also puts them at a disadvantage when they start searching for a place or are comparing prices on expenses. Being armed with the numbers makes your teenager a more informed consumer.

When Your Teen Breaks Their Budget

Will there be times where your teenager will mess up with their budget? Probably so. However, that’s not necessarily a bad thing. As parents, we tend to want to protect our kids, but we also have to prepare them for the real world. As Ron Lieber, author of The Opposite of Spoiled, pointed out we should let our kids make financial mistakes. 

Wouldn’t it be better for your child to break the clothing budget while they’re still at home allowing you to help guide them through rather than having break their monthly budget while they are on their own and have bills to pay?

Mistakes will happen, they’re a part of life so giving your teen time to work those them and adjust their budget is a blessing for their future selves.

Essential Accounts for Your Teen  to Have

Since we’re talking about budgets, we should also mention some essential accounts you’d want your kid to have so they can practice managing their money.

Opening up student checking and savings accounts (usually free low on fees as well as not having minimum balance requirements) are good foundational accounts for your teen. They can deal with real-world situations pending charges, automatic transfers, and direct deposits.

As Family Balance Sheet founder Kristia Ludwick pointed out, teens should have the skill of balancing a checkbook even if they decide to go all-digital with their banking.

If they work, talk it over together and see if they can open up an IRA and start contributing. It doesn’t have to be much. The idea is to get them familiar and comfortable with the basics of investing.

Even if they put in $25 a paycheck, having them practice setting aside money in their budget for both long and short term goals is an invaluable lesson. You can also encourage them to contribute by offering a match for what they put in.

How Teens Can Easily Stay on Top of Their Money

With several accounts to keep tabs on, your teen is going to need an easy system to track their budget and goals.

With Mint, they can link up their accounts in one secure spot. They can also add their budget along with any savings goals they want to hit and make sure they stick with them.

Hopefully, these ideas and tips will make it easier to help your teen transition into a self-sufficient adult.

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Which Companies Offer Discounts for Students

For most college students, trying to save money is a way of life. Whether it’s pirating textbooks, dumpster diving for food, or “borrowing” toilet paper from the library bathroom, students tend to find clever ways to pinch pennies.

But one of the best ways to save money as a college student goes largely ignored. Students can get discounts at many of the places they already shop, just by flashing their student ID or using their student email address. Here are some of the best offers – and how to get them.

Best Discounts for College Students

The following retailers and merchants offer special pricing for students:

Spotify

The Spotify Premium Student program offers a one-month free trial. After that, students will pay $4.99 a month for Spotify Premium, Hulu, and Showtime’s streaming service.

The discount is available for 48 months total. Subscribers may be required to provide extra documentation to verify their status as a student. Unfortunately, you are not eligible for this offer if you’ve previously used Spotify Premium before. You may still be eligible if you already have a Hulu or Showtime account.

Apple

Apple offers lower prices for students as part of the Apple education program. For example, a 13-inch Macbook Pro costs $100 less and a 16-inch Macbook Pro is $200 less.

Apple does not require proof directly at the time of purchase, but they do reserve the right to audit the purchase after the fact. If you can’t prove you’re a student, they may charge you the difference between the regular price and the student price.

Samsung

Samsung offers students and teachers up to 30% off on tablets, smartphones, and laptops. They can also receive special pricing on other electronics and appliances like headphones, portable chargers, and monitors.

Unlike Apple, Samsung verifies student status before they receive the discount. You may have to upload documents to prove you’re a student.

Adobe Creative Cloud

The Adobe Creative Cloud suite includes programs like Photoshop, Illustrator, InDesign, Premiere Pro, and Lightroom.

Students can receive access to the Adobe Creative Cloud for $19.99 a month, compared to $52.99 a month for regular users. This offer lasts for a year, after which the price will change to $29.99 a month. Use a school email address to have your identity verified immediately during checkout.

Amazon Prime

While Amazon Prime normally costs $119 a year, students can get a free six-month trial. After that, the membership will only cost $6.49 a month, which is half off the normal price.

Students can get Showtime for only $0.99 a month for one year, a two-month trial subscription to Kindle Unlimited, and discounts on textbooks.

Microsoft Office 365

Students get free access to Microsoft programs like Word, Excel, PowerPoint, and more when they sign up using their student email address.

Microsoft may ask to verify your school enrollment at any time. If you are no longer a student, they can cancel the membership immediately.

HP

Students can save up to 35% off on HP products like computers, printers, and laptops. To receive access to the HP Education Store, you have to register with a student email address ending in “.edu”.

Dell

Students can save $100 off certain computers and up to 10% off monitors and other accessories.

Nike

Nike normally offers a 10% discount for students but has recently increased it to 20%. Students have to prove their eligibility online before receiving a special coupon code.

The code can only be used once every 30 days.

Local attractions

Many movie theaters, museums, and other attractions have specific student prices available with a student ID.

Cell phone carriers

Verizon and AT&T both offer student discounts on cell phone plans. Students can save $10 a month for the unlimited package on one line or $25 off for two lines.

Students have to apply for the AT&T Signature Program, which determines eligibility based on your email address.

Gyms

Many local and national chains offer special membership pricing for students. Some, like the YMCA, may offer a sliding scale membership based on your income.

Clothing stores

Many clothing stores offer a discount to students. Retailers including J.Crew, Madewell, Uniqlo, and H&M offer 15% off to students.

In general, these discounts can range from 10 to 20% off depending on the company. You usually have to show a student ID when shopping in-person or use a student email address if shopping online.

YouTube

Students get a one-month free trial to YouTube Premium and then a $6.99 monthly membership, compared to the $11.99 standard price. This subscription includes ad-free videos, the ability to download videos for offline watching, and access to YouTube Music Premium.

Students have to verify their status every year.

Goodwill

Students who already love to save money should shop at Goodwill. Some locations provide an extra 10% off if you show a student ID. Other locations may have certain days of the week where students get an extra discount.

Call your local Goodwill and ask about their specific policy.

How to Get the Student Discount

Most in-store retailers require that you show a student ID as proof. If you forget the ID at home, they may deny the request.

If you’re shopping online, your student email address will be used to verify your status. You may not get the discount if you try to use a regular Gmail address.

Other companies will go a step further and verify your enrollment directly with the school. Getting a discount may not work if you’ve already graduated, even if you still have a student ID or a university email address.

Even if there’s no explicit student discount on a store’s website, it never hurts to ask. They may have an unwritten rule or be willing to extend a special offer.

Sometimes the student discount cannot be combined with other sales, offers or coupons. If that’s the case, you may be better off buying an item on sale than applying the student discount to a full-price item.

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A Guide to Real Estate Counter Offers

Unless you’re fresh out of a Negotiating 101 final and ready to huck your textbook straight into the trash, navigating real estate counter offers might not be at the top of your mind.

That’s OK. For most folks, the wild and sometimes-bumpy ride of buying or selling a house isn’t something they’re necessarily prepared for.

homebuying process, unexpected twists and turns can arise. After sifting through hundreds of listings, attending several showings, and putting an offer in on a dream home (or two, or three), the deal can be far from done.

There are many reasons why it takes time to buy a house, and counter offers can certainly be one of them. A real estate counter offer can come into play in these scenarios:

A Change in Sales Price

One of the most commonly contested items in the closing of a house is the sales price. If buyers come in lower than the asking price with their offer, sellers might counter with the original asking price (if they’re unwilling to negotiate) or somewhere between the asking price and the offer.

Requesting a Later Closing Date

Sometimes sellers simply need more time to vacate the premises. Whether they have unfinished business or unexpected plans, they may present a counter offer that extends the escrow period to allow them more time to move out.

Increasing the Earnest Money Deposit

In some cases, the seller could up the ante by increasing the earnest, or “good faith,” money deposit the buyer submits with the offer. Earnest money deposits are typically between 1% and 3% of the purchase price, but in a hot market, there’s a chance the seller could ask for more to ensure the buyer is serious about purchasing the property.

The Removal of Certain Contingencies

Contingency clauses are actions or conditions that must be met before a real estate contract becomes binding. Common contingencies, which most sellers will see as standard in a real estate offer, are:

•   An appraisal contingency to protect buyers if the property is valued lower than the amount they offer.
•   A financing contingency that allows buyers adequate time to obtain a mortgage or other financing to purchase the property.
•   An inspection contingency that ensures buyers have the right to a thorough inspection of the property within a specified period of time.

Some contingencies, however, are considered less than standard. For example, a home sale contingency grants buyers a set amount of time to sell their existing home so they can finance the new property. Some sellers may find this contingency burdensome, particularly in a hot market, so they could make a counter offer that removes the home sale contingency. They can also counter with a “kick-out clause” that gives a real estate agent the right to keep showing the house while buyers attempt to sell their existing home.

Requesting Repairs

If a home inspection reveals necessary repairs or renovations to the property, the buyer could submit a counter offer to negotiate a lower price or ask the seller to complete the repairs before closing.

Deciding Who Covers Closing Costs

In a buyer’s market, it might be possible to negotiate some or all of the closing costs to be paid by the seller. These costs include appraisal fees, settlement fees, title policies, recording fees, land surveys, and transfer tax. Many home buyers are surprised by how expensive closing costs are, but in particularly hot markets with multiple offers, sellers can counter with a simple “no” to indicate they won’t be covering those costs for the buyer.

What’s the Typical Counter Offer Process?

While real estate counter offers vary depending on the market, the seller’s unique circumstances, and other standalone factors, there are some fairly standard parameters to the counter offer process:

What’s a ‘Normal’ Number of Counter Offers?

There’s no legal limit to the number of counter offers that can occur in a real estate transaction. Initial offers, counter offers, and subsequent counter offers could ping pong back and forth for weeks or more.

Knowing the local real estate market can be key here. In a buyer’s market with plenty of houses for sale, sellers might want to be cautious about submitting an unnecessary number of counter offers.

Similarly, in a seller’s market where inventory is low and buyer competition is high, buyers might want to limit the number of counter offers they push back at the seller.

Can a Seller Make Simultaneous Counter Offers?

Depending on the state where the real estate transaction takes place, a seller may or may not be able to make counter offers to more than one buyer. That said, most real estate agents advise against multiple simultaneous counteroffers, as it could end up in two legally binding contracts for the seller.

How Long Does the Process Take?

Number of counter offers aside, home buyers can expect a closing to take 45 days on average. But how long it takes still varies from buyer to buyer, with factors like whether they’re paying cash, how long it takes them to find an inspector, and if the house appraises at a lower value, affecting the overall timeline.

How to Counter Offer in Real Estate

To some degree there’s such a thing as real estate counter offer etiquette. Here are a few things to consider when engaging in the counter offer process:

Having a Comprehensive Picture of Costs

For buyers, having an accurate handle on what it will cost to buy the house is essential for negotiating counter offers discerningly.

mortgage calculator helps buyers break down the cost of purchasing a home.

Going In With a Strong Offer

A “strong” offer is backed by data that defines what’s happening in the market, and research (with the help of an agent) around what’s considered “fair market value.”

Coming in at 15% or more under the fair market value is generally considered a “lowball” offer and can start buyers off on the wrong foot. In some cases, sellers might skip right over anything that isn’t considered a strong offer.

Knowing What Can Be Negotiated

One of the first steps in making a real estate counter offer is knowing what can be negotiated:

•  Possession date. Giving the sellers more time to move out could mean an exchange for a condition the buyer desires. Buyers hoping to move in sooner might make a counter offer requesting an earlier possession date.
•  Personal property. Some of the seller’s personal property like furniture, window treatments, artwork, or gardening tools could be negotiated into the contract in a counter offer.
•  Home warranty. Older houses can come with their own unique sets of systems and appliances, so buyers might make a counter offer asking the sellers to cover the cost of a one- to two-year home warranty ($350 to $600 annually, on average) if unexpected repairs need to be made after move-in.
•  Earnest money deposit. Whether buyers are trying to reduce their risk of something going wrong during closing or strengthen their offer, they can negotiate a lower or higher earnest money deposit with a counter offer.

Being Timely and Responsive

Real estate offers and counter offers often come with a set expiration date, so time is usually of the essence. Forty-eight hours is a standard acceptance window in many real estate markets, but in hot markets offers might expire within 24 hours or less.

Some sellers take this concept to a whole new level, setting stringent requirements around offer acceptance. It’s up to buyers to determine whether or not they’re willing to reply quickly enough to meet the sellers’ time demands or risk losing the deal.

Trying Not to Take Things Personally

It might not feel like “all’s fair in buying and selling a home” since it’s one of the biggest financial transactions many will make in their lifetime. But buyers and sellers shouldn’t be surprised if it comes with a little bit of literal give and take.

And while it might seem like a personal affront to have a real estate offer rejected, it’s possible (and even likely) that the seller has multiple offers or was simply able to strike a better deal.

When push comes to shove and purchase comes to close, buying a house is a matter of business, no matter how personal the home buying journey can feel.

The Takeaway

Real estate counter offers are a common form of business negotiation, and a first step in making a counter offer is knowing what can be negotiated. Being cognizant of counter offer etiquette can be helpful.

Having your home financing lined up can also be helpful. SoFi offers home loans with competitive rates and no hidden fees.

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Why UGMA/UTMA Accounts Are the Perfect Holiday Gift

If you have a special child in your life, you may be wondering what to put under the tree this year. One long-lasting and truly meaningful way to show the child in your life that you care is by taking a few minutes to set up a UGMA/UTMA account and give them a leg up in life.

The earlier you open a UGMA or UTMA account for a child, the longer your initial gift has to grow, thanks to the magic of compound interest. For example, investing just $5 a day from birth at an 8% return could make that child a millionaire by the age of 50. By setting up a UGMA/UTMA account, you’re really giving your beneficiary a present that grows all year round. Now, that’s a gift they’re sure to remember!

What is a UGMA/UTMA account?

UGMA is an abbreviation for the Uniform Gifts to Minors Act. And UTMA stands for Uniform Transfers to Minors Act. Both UGMA and UTMA accounts are custodial accounts created for the benefit of a minor (or beneficiary).

The money in a UGMA/UTMA account can be used for educational expenses (like college tuition), along with anything that benefits the child – including housing, transportation, technology, and more. On the other hand, 529 plans can only be used for qualified educational expenses, like summer camps, school uniforms, or private school tuition and fees.

It’s important to keep in mind that you cannot use UGMA/UTMA funds to provide the child with items that parents or guardians would be reasonably expected to provide, such as food, shelter, and clothing. Another important point is that when you set up a UGMA/UTMA account, the money is irrevocably transferred to the child, meaning it cannot be returned to the donor.

Tax advantages of a UGMA/UTMA account

The contributions you make to a UGMA/UTMA account are not tax-deductible in the year that you make the contribution, and they are subject to gift tax limits. The income that you receive each year from the UGMA/UTMA account does have special tax advantages when compared to income that you would get in a traditional investment account, making it a great tax-advantaged option for you to invest in the child you love.

Here’s how that works. In 2020, the first $1,100 of investment income earned in a UGMA/UTMA account may be claimed on the custodian’s’ tax return, tax free. The next $1,100 is then taxed at the child’s (usually much lower) tax rate. Any income in excess of those amounts must be claimed at the custodian’s regular tax rate.

A few things to be aware of with UGMA/UTMA accounts

While there’s no doubt that UGMA/UTMA accounts have several advantages and a place in your overall financial portfolio, there are a few things to consider before you open up a UGMA/UTMA account:

  • When the child reaches the age of majority (usually 18 or 21, depending on the specifics of the plan), the money is theirs, without restriction.
  • When the UGMA/UTMA funds are released, they are factored into the minor’s assets.
  • The value of these assets will factor into the minor’s financial aid calculations, and may play a big role in determining if they qualify for certain programs, such as SSDI and Medicaid.

Where you can open a UGMA/UTMA account

Many financial services companies and brokerages offer UGMA or UTMA accounts. One option is the Acorns Early program from Acorns. Acorns Early is a UGMA/UTMA account that is included with the Acorns Family plan, which costs $5 / month. Acorns Early takes 5 minutes to set up, and you can add multiple kids at no extra charge. The Acorns Family plan also includes  Acorns Invest, Later, and Spend so you can manage all of the family’s finances, from one easy app.

During a time where many of us are laying low this holiday season due to COVID-19, remember that presents don’t just need to be a material possession your loved one unwraps, and then often forgets about. Give the gift of lasting impact through a UGMA/UTMA account.

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